08/16/2011 10:18 pm ET Updated Oct 16, 2011

She Who Hesitates, Rents

The woman was fidgety as she shared her qualms about buying a house. More than once she said, "I know this doesn't make total sense..." as she discussed the reasons for her reluctance.

"I don't want to take a big mortgage out now," she explained, "because I don't know if we'll still have jobs in six months or a year." I understood -- Long Island's economic climate was foggy, with only the number of empty stores and shuttered businesses growing. Just about everyone feels overburdened by the high cost of living (and driving).

She was also procrastinating because she'd seen good friends left without equity in a house they recently sold, six years after paying "top dollar" for it. "I don't want to pay for a house that will be worth less in six months or a year." After validating her feelings, I questioned whether a value drop in 2012 was really a concern. Wasn't she looking to live in a home for years, not speculating on a short-term investment?

She nodded, but the doubts quickly resurfaced. What if they had to sell quickly and get back their money? As this woman was not a client seeking my counsel, I devilishly played advocate, noting people made similar arguments about buying new cars, booking lavish weddings, or investing in three-year bank CDs. At some point or stage in a person's life, buying a house might be appropriate. Any future "what-if's" should be set aside unless (or until) one knocked on the front door.

My diffident dining companion had more present hesitations, including, "What if interest rates drop further?" As someone who signed a 14% mortgage note in the past, I'm no percentage prophet. Having advised many clients over the years on how and when to refinance, however, I ventured that with respectable enough equity and credit, a refinance would drop her payments into the valley of the plummeting rates.

Well, maybe... but there was still that whole "quality of life" issue. She was apprehensive about buying a house because she could end up "being on a block with a lot of foreclosures, or owning a house with lots of renters around."

She was renting now, but she has a problem with other renters? "Sure," she generalized. "They won't take care of the houses like actual homeowners." Plus, even a few foreclosures would invite skulking, buzzing, and scurrying "pests" to inhabit her block.

I asserted that, with so many misgivings, I'd feel uncomfortable buying a house now, too. Those various excuses and misgivings she initially thought didn't make sense? It seemed to me that they added up to a strong case for delay.

The house-hesitant woman suddenly looked happier, declaring with delight that my endorsement of her timidity was "better than a therapy session!" I'm glad she gained confidence from our talk, but perhaps a therapist and a home seller each lost an opportunity to make money.